Excusable infringement of territory exclusivity
The District Court of Rotterdam recently ruled on a matter concerning infringement of the agreed district exclusivity. The franchise agreement stipulated that the franchisee enjoyed the exclusive right to operate the formula within a radius of 15 kilometers from its location. In fact, however, several branches of the franchisor were located within a radius of 15 kilometers. Franchisee claimed to suffer damage as a result of this infringement. The franchisee requested an injunction in interlocutory proceedings subject to forfeiture of a penalty. The court rules that the alleged damage by the franchisee has not been substantiated or has not been sufficiently substantiated and that there is therefore no urgent interest in instituting such a claim in summary proceedings. The court also considers that the exclusivity was in fact not complied with and the franchisee was also aware of this. Moreover, the franchisee had failed to protest in time. The franchisee’s claims were rejected in full.
The foregoing means that franchisees cannot lightly invoke provisions in the franchise agreement without a well-founded interest if the parties actually act differently over a long period of time. In those cases, the exceeding of the standard may be excusable. For franchisors, it is therefore easier to enforce standards that are exceeded if the provisions are observed more strictly in practice and if the policy to this effect is clear. In particular, franchisees must protest in good time.
mr J. Sterk – franchise lawyer
Ludwig & Van Dam Franchise attorneys, franchise legal advice Would you like to respond? Mail to info@ludwigvandam.nl
![](https://ludwigvandam.megaconcept.nl/wp-content/uploads/2020/12/232court-min-400x222.jpg)
Other messages
Termination of franchise agreement in case of changes in leased retail space – September 27, 2019 – mr. AW Dolphin
Termination of a franchise agreement in light of a substantial change in the leased retail space.
Article De Nationale Franchisegids: “Distribution of (potential) customers prohibited?” – September 17, 2019 – mr. AW Dolphin
Within many franchise organizations, agreements are made about the recruitment of (potential) customers in a certain area.
District protection no protection against termination due to urgent own use – dated September 17, 2019 – mr. AW Dolphin
As a landlord, can the franchisor terminate the lease for urgent own use, in the sense of district protection, while this would be excluded on the basis of the franchise agreement.
Unreasonable compensation at the end of the franchise agreement – dated September 17, 2019 – mr. AW Dolphin
Some franchise agreements stipulate that the franchisee always owes the franchisor a minimum of a certain amount of costs upon termination of the franchise agreement.
Legal Franchise Statistics 2019: slight decrease in number of franchise disputes
In 2018, 44 judgments were published on Rechtspraak.nl, 12 of which were appeal cases and one in cassation (a prognosis issue against Albert Heijn).
Article De Nationale Franchisegids: “Judge again rules in favor of Domino’s franchisees” – dated September 3, 2019 – mr. RCWL Albers
At the beginning of 2018, almost all franchisees of Domino's and the Association of Domino's Pizza Franchisees submitted two issues to the court in Rotterdam.